Today’s June cash report from state Comptroller Tom DiNapoli says first quarter tax collections were $487 million below projections, in line with the trend reflected in Taxation and Finance data cited below.

DiNapoli’s press release statement chose to focus on the bright side, noting that general fund revenues for the month of June alone “were not as bad as anticipated given the downward trend of recent months.”  Well, gee, if you’re determined to say something positive …   But general fund results alone can be misleading.  The fact remains that All Funds tax receipts were downright lousy, for the month and the quarter.

The comptroller also reported that All Funds spending was a whopping $1.6 billion below projections for the quarter, which may reflect some customary over-estimation of welfare and Medicaid spending by the Division of the Budget (DOB), as well as a “timing related” change in general state charges payments.

The Paterson administration’s ability to manage a revenue shortfall this year without seeking significant budget cuts will depend in part on how much more of a cushion DOB has squirreled away on the expenditure side. DiNapoli said the numbers in the June report “reinforce the need for caution.”   However, will mere “caution” keep Albany’s head above water if the bellwether September tax collections and cash reports aren’t much better than anticipated?  That’s a question Governor Paterson needs to carefully ponder.  His answer will come in DOB’s first-quarter financial plan update, due by the end of next week.